Chapel Hill company Heat Biologics reported it now has enough money to continue its drug-development efforts through at least the first quarter of 2016 after raising $7.5 million in debt financing.
“The strategy is to continue doing what we are doing and progress our clinical trials,” said CEO Jeff Wolf.
Heat has no products on the market but is developing drugs for bladder cancer and lung cancer. The company expects to report initial results from a Phase 2 trial of its bladder cancer treatment in the third quarter of 2016; the company’s Phase 2 trial of its lung cancer treatment is under way.
The new financing, announced Monday, was obtained from Durham-based Square 1 Bank.
Monday’s announcement followed on the heels of a 61 percent surge in the stock over two days – Thursday and Friday.
That surge came after an investor newsletter published by Stansberry & Associates Investment Research, Small Stock Specialist, advocated buying the stock.
“Considering Heat Biologics’ revolutionary cancer approach,” the newsletter stated, “the stock is a downright steal at current levels.”
Heat shares closed Monday at $6.12, down 56 cents. The company went public at $10 a share last year.
Wolf said of the steep climb in the stock price last week: “We’d like to believe the market is beginning to realize the value in Heat Biologics.”
Although Heat Biologics is going it alone with its drug-development efforts in the near-term, it is exploring corporate partnerships that could help fund future clinical trials. Toward that end the company hired pharmaceutical industry veteran Anil K. Goyal as vice president of business development in December.
“He’s in the process of exploring relationships with other groups,” Wolf said.
Heat, which employs about 8 full-time workers and one part-time worker, had $16.8 million in cash as of June 30.